Vulcan Energy Resources has advanced to a critical new stage in developing its flagship “Lionheart” lithium project in Germany. With key financing secured and positive well test results in hand, the company has initiated physical construction at multiple sites in the Upper Rhine Valley. The focus now shifts to execution, as the company works to meet its ambitious timeline for commercial production.
Financing Secured for Major Development
A cornerstone for the project’s progression is a confirmed €2.2 billion funding package for the first phase of construction and development. This financial backing enabled Vulcan’s board to make a positive final investment decision in December 2025. The comprehensive package is structured from multiple sources:
- A €250 million loan facility from the European Investment Bank, signed in December 2025.
- More than €350 million in public funding from the German federal government, comprising grants and equity participation.
- Syndicated loans from a consortium of banks including ABN AMRO, BNP Paribas, ING, KommunalKredit Austria, Natixis, OCBC, and Unicredit.
- Support from export credit agencies such as Bpifrance, EDC, Export Finance Australia, EIFO, and SACE.
The company reported robust liquidity, with cash reserves of €523 million at the close of the fourth quarter in 2025.
Production Well Exceeds Development Plan Assumptions
Recent operational updates provide technical validation for the project’s viability. The company confirmed strong results from a production test on its first new Lionheart well, designated LSC-1b Sidetrack. Data indicates a production potential of 105 to 125 liters per second, surpassing the average requirement of approximately 84 to 94 liters per second outlined in the Phase 1 field development plan.
Vulcan also reported that core parameters at its Schleidberg site near Landau are meeting or exceeding the plan’s assumptions. These parameters include lithium concentration, temperature, reservoir quality, and rock permeability. The drilling operation itself was completed safely and ahead of schedule by the company’s in-house drilling subsidiary, Vercana, with no reported health, safety, or environmental incidents. The LSC-1 well marks the fifth drilling operation for Phase 1 development, with four wells already in production.
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Construction Ramps Up with Key Contracts in Place
On-the-ground activity is now expanding. Vulcan has commenced the physical build-out at several locations. A significant step was the purchase agreement for approximately 10 hectares of land in the “Messegelände Südost D12” industrial park in Landau, designated for the commercial lithium extraction plant and a geothermal power station. The company states it has received all major permits required for Phase 1, including the permit for the upstream lithium extraction facility in Landau.
The supply chain is being locked in through major contractor agreements. Vulcan has appointed:
* A joint venture between Sedgman and HOCHTIEF for EPCM (Engineering, Procurement, and Construction Management) services.
* JordProxa for lithium purification technology.
* ABB as the primary electrical contractor.
For product offtake, a key marketing agreement is already secured. A deal signed with Glencore in October 2025 commits Vulcan to supply between 36,000 and 44,000 tonnes of lithium hydroxide monohydrate over the project’s first eight years of production, providing predictable sales volumes for the initial phase.
Phase 1 is targeting an annual production capacity of 24,000 tonnes of lithium hydroxide monohydrate. The scheduled commencement of commercial production remains set for 2028.
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